Plans to tackle abuses of zero-hours contracts by allowing people to work for more than one employer have been attacked as insufficient by unions.

The business secretary Vince Cable said the reforms, aimed at outlawing so-called exclusivity clauses, would tackle "unscrupulous" employers who had had been abusing the flexibility offered by zero-hours.

Unions and campaign groups have long demanded that the contracts, under which workers do not know if they have work from one week to the next, should be banned but Mr Cable told Sky News they have a place, provided they are "fair".

He said: "It has become clear that some unscrupulous employers abuse the flexibility that these contracts offer to the detriment of their workers.

"Today, we are legislating to clamp down on abuses to ensure people get a fair deal.

"Last December, I launched a consultation into this issue. Following overwhelming evidence we are now banning the use of exclusivity in zero-hours contracts and committing to increase the availability of information for employees on these contracts.

"We will also work with unions and business to develop a best practice code of conduct aimed at employers who wish to use zero-hours contracts as part of their workforce".

The Government said the ban would benefit 125,000 zero-hours contract workers estimated to be tied to an exclusivity clause and allow workers to look for additional work to boost their income.

Frances O'Grady wants measures to guarantee incomes

While the move was largely welcomed by business lobby groups, Labour suggested that ministers had allowed the controversial contracts to soar out of control.

Shadow business secretary Chuka Umunna said: "Under David Cameron's government we've seen a rising tide of insecurity.

"The Government has watered down people's rights at work and have failed to match Labour's plans to outlaw zero hours contracts where they exploit people.

"Labour will ensure that people at work get a fair deal and proper protections so they are not forced to be available around the clock, are paid if shifts are cancelled at short notice and are able to demand a full contract if, in practice, they are working regular hours".

TUC general secretary Frances O'Grady added: "The ban is welcome news but it's not nearly enough to really tackle the problem.

"A lack of certainty is the real issue. Far too many employees have no idea from one week to the next just how many hours they'll be working or more importantly how much money they'll earn.